Pathmark Offers Loyalty/Payment Combo Card

The regional grocery chain is going to trial with an innovative way to slash credit card interchange fees.

The Pathmark 141-store regional grocery chain is going to trial with an innovative way to slash credit card interchange fees.
Pathmark, based on Cartaret, N.J., is rolling out a branded combination loyalty and payment card, selling convenience and discounts to its customers. The catch: the combo card only offers debit payment.

The chain will start a trial of the Pathmark Advantage Payment Card in December at five to 10 New York Pathmark stores, where the trial will be evaluated for six months, said Pathmark spokesperson Rich Savner.

The convenience part of the pitch is for customers to have one piece of plastic to handle both payment and loyalty/CRM (customer relationship management). Savner said the program makes it faster and more convenient for customers than writing checks, but he also said that the number of customers still routinely writing checks is low. The percent of customers already actively using their loyalty cards, Savner said, "is in the high 80s."
Reducing credit card transaction fees "is certainly a benefit" for Pathmark, he said.
Pathmark is working with HSBC Finance and the Tempo payment network on the trial.
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Evan Schuman is the editor of CIOInsight.com's Retail industry center. He has covered retail technology issues since 1988 for Ziff-Davis, CMP Media, IDG, Penton, Lebhar-Friedman, VNU, BusinessWeek, Business 2.0 and United Press International, among others. He can be reached by e-mail at Evan.Schuman@ziffdavisenterprise.com.